Finance Minister addresses IMF committee in Washington

April 13, 2008

Minister of Finance Dr. Ibrahim Al-Assaf said yesterday that Saudi Arabia would continue to ensure that the oil market is well supplied.

Al-Assaf made the remarks in an address to the International Monetary Fund’s International Monetary and Financial Committee in Washington.

In his address, Al-Assaf highlighted the strength of the Saudi economy, noting that a substantial surplus has enabled the government to invest heavily in the country’s infrastructure.

“Government spending included a significant increase in education, social services and infrastructure development. The progress in structural reforms contributed to increasing the role of private sector and achieving high growth rates,” he said.

The finance minister noted that the financial crisis surrounding the US subprime mortgage market has spread, and lauded the US government’s efforts to address the problem.

“It is also important for other industrial countries to make use of any fiscal and monetary space available to address the slowdown in their economies,” Al-Assaf said.

He also warned that rising food prices are taking a heavy toll, particularly on the impoverished, and creating conditions for social unrest.

“Advanced economies have moral responsibility, as subsidizing the agriculture sector and restricting market access for agricultural products have contributed to the underdevelopment of this sector in low-income countries and increased their dependence on food imports,” Al-Assaf said.

“It is also important to underscore that rising biofuel production in some advanced economies has boosted demand for certain food grains and edible oils, which has contributed to the rise in food prices.”